Mixed reactions trail new increase in pump price

Mixed reactions yesterday trailed the announcement by the Petroleum Products Pricing Regulatory Agency (PPPRA) that petrol will now sell for N145 per litre with some experts applauding the decision and also expressing reservations on the policy.

Those who yesterday welcomed the development, lamented yet that the timing was wrong, stressing the need for local production of Premium Motor Spirit (PMS) otherwise known as petrol to reduce the effects on consumers. Head, Eco Bank Development Company, Dolapo Oni, stated that the government has taken a good step forward with this decision.

According to him, full deregulation would have meant going beyond relaxing the import restrictions to allow anyone also sell at any price they deem fit.

He added that this would mean some parts of the country would buy fuel at really high prices due to low supply. Oni, however, noted that capping the price of fuel at N145 would allow anyone who can access forex at less than N285 a litre at current gasoline import prices to bring in fuel and still make profit.

Speaking on the issue, the Director-General of Lagos Chamber of Commerce and Industry (LCCI), Muda Yusuf, stated that the decision by the Federal Government to liberalize the petroleum downstream sector is inevitable given the acute resource constraint that the country is faced with at this time.

It will boost private investment in the downstream oil sector especially in petroleum product refining. This will ultimately reduce importation of petroleum products and ease the pressure on the foreign exchange market as well as foreign reserves,” he added.

But a Professor of Technology Management, Obafemi Awolowo University, Ile-Ife, Francis Eniterai Ogbimi, believed that government has done wrong by capping the price of fuel at N145 per litre.

He said government should have focused on revitalising the country’s refineries and become self-sufficient in petroleum refining before removing fuel subidy.

According him, the new policy will not solves the country’s downstream challenges but would only give room for more people to enrich themselves while other suffer the high cost of the product.